Google will increase prices for its online payment service, Google Checkout, on May 5th.

Google has up until now given steep discounts to Google AdWords advertisers, making transaction processing very cheap for these customers, with others charged at 2% plus 30 cents. New prices will start at 2.9% plus 30cents for monthly transactions under US$3000, with the percentage falling to 1.9% for merchants that bill over $100,000 monthly. AdWords customers will receive no rebate under the new scheme.

{ad}The move brings Google Checkout fees roughly into line with PayPal, which has dismayed users who saw Google as a cheap alternative. In a statement, Anita Barci, Product Marketing Manager at Google, said:

We’re committed to the continued growth and development of Checkout and to helping merchants increase sales by driving more leads and higher conversions